Welcome back: When you think of direct air capture you think of Climeworks. The Swiss carbon-removal startup is synonymous with DAC technology, and its awesome Mammoth facility in Iceland, looking like something straight out of a sci-fi movie, is impressive to behold. 

Climeworks is celebrating this week because it has surpassed $1 billion in total equity funding. Our congratulations to all involved. But when you consider that the company is now 16 years old, $1 billion doesn't seem like that much really - even less when you factor in the levels of investments made in other forms of clean tech: just this week, for example, Google signed one of the world’s first commercial deals for fusion energy in an agreement with a startup that is thought to be worth several billions. 

A recent academic paper proposes that the fight against global warming should embrace both the highly technical (DAC) and the not-so technical (trees) forms of carbon removal, arguing that a more unified approach would be beneficial to all. Despite the state of the art work being done at Climeworks, this “all of the above” idea has been embraced by the CEO.   

Read on for more on the story and other sustainability news.

The Senate removed a proposed tax on wind and solar projects in the version of the megabill that passed the chamber Tuesday, but an end to lucrative tax credits still stands to cripple the renewable-energy sector, the WSJ's Jennifer Hiller writes.

Clean-energy companies say the U.S. risks a slowdown in power delivery during the global artificial-intelligence race by ending the tax credits that were part of former President Joe Biden’s landmark Inflation Reduction Act. The U.S. is also poised to cede advances in technologies from solar panels to batteries and electric vehicles to China.

“The big-picture outlook for energy is we are going to be less competitive because of this law,” said Nick Nigro of Atlas Public Policy. “Ten years from now we could look back on this moment as the time in which the U.S. pulled back and essentially lost the transition to clean energy.”

With each new version of Trump’s “big beautiful bill,” the outlook for the renewables sector has shifted. Currently, big wind and solar projects, U.S. factories and the EV industry are losing out; while hydrogen is a winner.

Swiss carbon-removal startup Climeworks secured $162 million in its latest funding round taking its total equity fundraising to more than $1 billion, WSJ Pro Sustainable Business's Yusuf Khan reports.

The company, which was set up in 2009 to remove carbon emissions from the atmosphere, has been backed by some of the world’s largest businesses, including Microsoft, BCG and Morgan Stanley. Its pioneering technology sucks carbon dioxide out of the atmosphere using giant plants that can remove up to 36,000 tons of CO2 a year.

However, last year, despite the company being synonymous with direct air capture, Climeworks pivoted to a strategy in which it acts as a buyer of credits in other forms of carbon removal, such as reforestation, enhanced rock weathering and biochar, on behalf of its customers. Typically, credits in these other forms of carbon removal are much cheaper than DAC, often by at least several hundred dollars per ton of carbon dioxide removed.

Despite the policy pushback, corporate demand for carbon removals remains high. So far this year, 16 million tons of durable carbon removals have been purchased according to CDR.fyi, a carbon removal database, compared with 7.7 million for the whole of 2024.

California lawmakers rolled back one of the most stringent environmental laws in the country this week, after Gov. Gavin Newsom muscled through the effort in a dramatic move to combat the state’s affordability crisis, the WSJ's Jim Carlton writes.

The Democratic governor—seen as a 2028 presidential contender—made passage of two bills addressing an acute housing shortage a condition of his signing the 2025-26 budget. A cornerstone of the legislation reins in the California Environmental Quality Act, which for more than a half-century has been used by opponents to block almost any kind of development.

Some environmentalists were furious, and warned that developers will now go unchecked. But California sits at the epicenter of America’s home shortage. The state has faced a homelessness crisis and nine of the 10 least affordable cities in the country are located there, according to a May 20 report by WalletHub, a personal-finance company.

Now California developers are celebrating. The new legislation exempts most new housing projects in urban centers from what has been lengthy environmental reviews, a significant victory for the real-estate industry, which has been lobbying for this exemption for years.

• The Worst Housing Market in America Is Now Florida’s Cape Coral

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The European Union is pushing ahead with an ambitious new target for cutting greenhouse gas emissions, signaling a growing divide between the U.S. and the rest of the industrialized world, the WSJ's Matthew Dalton and Kim Mackrael report.

The European Commission, the EU’s executive, said Wednesday it wants emissions in the bloc to decrease 90% by 2040 compared with 1990 levels. The commission’s previous goal was for emissions to fall 55% by 2030.

The proposal comes as the Trump administration has embraced fossil fuels and is pushing Congress to pass legislation that would slash federal government support for wind farms, solar panels, hydrogen production and other clean technologies.

America’s economic rivals believe clean energy can drive economic growth. China has thrown its might behind the strategy and is producing more solar panels, electric vehicles and other clean technologies than the rest of the world combined. Japan, Canada and Australia are also pushing ahead with ambitious plans to slash emissions.

The commission’s new proposal comes as Europe endures a record-breaking heat wave. Rising global temperatures as a result of climate change have been more pronounced in Europe, scientists say.

• Tesla’s global vehicle deliveries plunged in second quarter. (WSJ)
   
• Richest man under 40 goes all-in on green at perilous time. (Bloomberg)
   
• Stellantis seeking more time to meet EU's CO2 targets. (Reuters)
   
• Nestlé expands program to improve cocoa livelihoods. (ESG Today)
   
• Unilever’s CSO on moving from vision to execution. (Trellis)
   
• U.S. energy groups spend record sums on data centre power plants. (FT)
   
• Managing divergence in DEI obligations. (Dow Jones Risk Journal)
   
• More than 80% of U.K. farmers worried about climate crisis. (Guardian)

WSJ Pro Sustainable Business gives you an inside look at how companies are tackling sustainability. Send comments to bureau chief Perry Cleveland-Peck at perry.cleveland-peck@wsj.com and reporters Clara Hudson at clara.hudson@wsj.com and Yusuf Khan at yusuf.khan@wsj.com. Follow us on LinkedIn at wsjperry, clara-hudson and yusuf_khan.